Senate deal boosts asbestos-related shares
By Padraic Cassidy, MarketWatch
Last Update: 10:52 AM ET May 24, 2005
NEW YORK (MarketWatch) - Shares of asbestos-related stocks rallied Tuesday as a major obstacle in the U.S. Senate to consideration of a trust fund asbestos liability bill - the showdown over judicial nominees - faded after an eleventh-hour agreement among senators to avoid a prolonged fight.
Shares in companies with asbestos-exposure liabilities rose sharply Tuesday.
Owens Corning (OWENQ: news, chart, profile) stock rose 99 cents, or 28%, to $4.52; Armstrong Holdings Inc. (ACKHQ: news, chart, profile) rallied 65 cents, or 24%, to $3.35; W.R. Grace & Co. (GRA: news, chart, profile) rose $1.65, or about 18%, to $10.78; USG Corp. (USG: news, chart, profile) stock jumped $4.50 to $48; and McDermott International Inc. (MDR: news, chart, profile) shares were higher by $1.88 to $21.22.
Committee Chairman Arlen Specter (R-Pa.) is trying to move the bill out of committee by Memorial Day and should succeed with the votes to pass it, according to Susquehanna Financial Group analyst Crystal Skinner. Skinner put the odds of an asbestos bill becoming law in 2005 at 30%.
The bill must go from the committee to the Senate floor, Crystal wrote in a note to clients, "where prospects of passage will partially be determined by the strength of the vote that is produced at the Committee level; a strong representation of bipartisan support clearly represents the best scenario."
Before the deal on judicial nominees, a Lehman Bros. analysis put the likelihood of a 2005 asbestos bill at 25%.
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